WHEN UNDERWRITERS BECOME UNDERTAKERS DESPITE GLARING WARNING SIGNS, THE INSURERS APPROVED THE HEFTY LIFE-INSURANCE POLICY-- AND GAVE TWO CON MEN A REASON TO KILL
Cindy Monkman opened a Gideons Bible in her La Jolla motel room.
She read the verse she had turned to randomly--Psalm 39, Verse 4--then scribbled it in her journal: "Lord, make me know mine end, and what is the measure of my days; That I may know how frail I am."
The passage struck Cindy as prophetic.
"It is a crossroads for me," she wrote that evening of September 30, 1988. "I'm on the brink of a big change."
Though she seemed to most to be her normal, bubbly self, Cindy was hurting inside. A trim, tall, striking woman with a dazzling smile, Cindy had turned 30 two weeks earlier. The birthday had been a traumatic milestone.
She and a longtime boyfriend recently had broken up, probably for keeps. The relationship's end had increased Cindy's nagging doubts about the course her life was taking.
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Her quiet desperation carried over to her career. Cindy was a registered dietitian who had earned a master's degree in health education. But she couldn't decide whether to commit to that line of work. In the meantime, she was working two low-paying jobs in the East Valley--one as a dietitian for a medical group, the other as a waitress at a pizza joint.
Cindy was determined not to allow her funk to consume her. She'd signed up for classes in self-esteem at a Tempe counseling service.
And what better way to fight off her demons, Cindy Monkman had written in her diary, than a weekend trip to the sunny beaches of Southern California.
One week after her motel-room epiphany, Cindy met 25-year-old German immigrant Michael Apelt at Bobby McGee's restaurant in Mesa. On October 28, 1988, she eloped to Las Vegas with the lanky, blond stranger. She had known him for three weeks.
Ten days later, Cindy and her new husband walked into a Phoenix insurance agency. The couple told an agent they wanted $2 million in life insurance--$1 million on each--with a double-indemnity clause in case of accidental death. Each spouse was to be the other's sole beneficiary.
Thousands of dollars in commissions awaited agent Doug Ramsey if he could cinch the deal. But Ramsey knew there would be major hurdles in getting such a policy written: Cindy was earning only about $15,000 annually, and Michael Apelt--who had been in the U.S. for about two months--was unemployed and didn't even have a social security card. In his favor, Michael said a $500,000 estate was to come his way from his native land.
Ramsey couldn't justify asking an insurance company to issue such mammoth policies. Instead, he sought $400,000 in insurance on each newlywed.
The Apelts constituted a huge sales windfall for the agent, who was struggling to establish his business in Arizona. He knew from years of experience how rarely people buy life insurance on their own. They usually have to be sold--and sold hard. But who was he to look a gift horse in the mouth?
The first company he approached, Surety Life, looked at the Apelts' tenuous financial state and offered to insure them each for $100,000 instead of $400,000 each.
Ramsey snapped up Surety's offer, then asked a second company, Banner Life, to insure the couple for another $300,000 each. To bolster his case--and guarantee that all-important commission for himself--agent Ramsey falsely tripled the Apelts' annual income in his report to Banner.
On December 22, 1988, Ramsey hand-delivered the $100,000 Surety policy to the Apelts in Mesa. He also told them the larger Banner policy was a go, and he took a check from Cindy for the first month's premium.
Early the next evening, Michael and Cindy Apelt drove to a remote site east of Apache Junction. Michael's brother, Rudi, and Michael's ex-lover, a German woman named Anke Dorn, trailed in another car.
Cindy Monkman Apelt died there, at the foot of the Superstition Mountains, her lifeblood seeping into the desert after a stabbing that left her almost decapitated.
She had been married seven weeks.
A passerby came upon the grisly scene the next afternoon, Christmas Eve, 1988.
Police focused on Michael Apelt as their prime suspect after they learned about the life-insurance policies on which the ink was barely dry.
Two weeks after Cindy's murder, Anke Dorn told police that Michael had conspired to commit murder with his brother, Rudi. She told investigators that, before the homicide, "Michael said it would be a death warrant when Cindy signed the [life insurance] papers."
Furthermore, Dorn told detectives, Michael Apelt told her about the murder after the deed had been done.
Dorn became a star witness at the Apelts' murder trials. By doing so, she received immunity from prosecution.
Cindy Monkman Apelt's murder was not a crime of passion; it was the business decision of sociopaths for whom taking a human life was the means to a financial end. And the insurers, in their zeal to make lucrative sales, unwittingly abetted a homicide.
The evidence is overwhelming that the Apelt brothers would not have killed Cindy if her life hadn't been insured. Instead, they likely would have turned their criminal intentions to another woman, any other woman.
But there's more to this story than how a smitten woman was literally conned to death. The Apelt case allows a chilling look inside the usually inscrutable life-insurance industry.
A bona fide probe of Michael Apelt's background by the insurance companies would have exposed him as a dangerous fraud and con man. If a proper investigation had been done, the life-insurance policies never would have been issued.
And an innocent woman would not have died.
But the insurance companies--especially Banner Life--chose to ignore glaring warning signs and rushed to approve the Apelts' policies.
In fact, Michael didn't have a $500,000 estate. His most recent job in Germany had been as a laborer, not, as he'd indicated, as an employee of IBM. His checkered past included a burglary conviction, reduced through plea bargain from armed robbery. (Rudi Apelt had done time in a German prison for rape.)
Surety and Banner also neglected to do cursory checks of Doug Ramsey, the Phoenix insurance agent. One phone call would have revealed that the Kansas Department of Insurance in September 1988 had revoked Ramsey's license, upholding what amounted to allegations of theft. His Kansas license revocation occurred just six weeks before the newlyweds walked into his new office in Phoenix.
In a different world, companies faced with the errors of their ways would pay Cindy's estate $400,000 in death benefits--the value of the two policies on Cindy's life--and put the tragic episode behind them.
But Surety and Banner steadfastly have refused to do so.
Both firms say Michael Apelt obtained the policies fraudulently, which by law voided the contract. Banner also alleges the policy never took effect because Banner didn't cash the first premium check before the woman's murder.
In 1991, the dispute became a federal lawsuit filed by Cindy's parents, Jack and Marjorie Monkman of Champaign, Illinois, against the insurance companies and other parties.
Last year, United States District Judge Roger Strand narrowed the Monkmans' claim from a wrongful-death tort to a simple contract case. He then heard testimony this past summer at a two-day trial.
Strand is expected to rule soon on the one question before him: Do the insurance companies have to pay the Monkmans?
"There are things that insurance companies shouldn't get away with," says Jack Monkman, a psychologist. "If they had done an appropriate job of checking into some quite obvious facts about Michael Apelt, my daughter would be alive today."
But attorneys for Surety and Banner argue that the companies weren't compelled legally to investigate Michael Apelt before they approved the policies. It would be incorrect to punish Surety and Banner, they say, even if the insurers could have exposed Michael's fraudulent intent before they okayed the policies.
Remarkably, the insurance companies seem to have Arizona law in their favor. The odds are great that the firms will prevail in their legal fight with the Monkmans.
If Judge Strand does the expected, Cindy's survivors will be left to ponder this concept: Cindy died violently in a plot expedited by a powerful industry's institutional greed. But as for holding that industry legally culpable, tough luck.
Says Cindy's sister, Mesa resident Kathy Monkman-Nimon: "People need to know that insurance companies do everything in their power to make the sale, then do everything in their power not to have to pay. That's what this is all about."
It was a bustling Saturday night at Bobby McGee's restaurant and bar in Mesa. Dozens of young singles floated around the popular nightspot, checking out the scenery and hitting the dance floor.
Cindy Monkman was there with her sister, Kathy, and another friend, Annette Clay.
Cindy was 14 months older than Kathy, but it wasn't just their closeness in age that had bound them. Their mother had died when the sisters were little girls in Illinois.
Their father remarried several years later, long after the two had learned to take special care of each other and their younger brother, John. The bond would last a lifetime.
In their teens, friends of the girls referred to them as one entity--the "Monkman Sisters Syndrome." Cindy was the more outgoing of the two, poised in public, a friend to everyone. Kathy was more cerebral, less impetuous.
Cindy had moved to the Valley first, attracted by the sun and a program in dietics at Arizona State University. Kathy, now a registered nurse and massage therapist, joined her later.
Neither Monkman had a boyfriend when they went to Bobby McGee's on October 8, 1988. But Cindy's friend, Annette Clay, had met a pair of intriguing German brothers at the restaurant a few nights earlier, and planned to again hook up with them.
Annette had been taken with the older brother, 28-year-old Rudi Apelt. In halting English, he'd explained that he and Michael were investment bankers/computer experts who'd recently emigrated. That night, Rudi had asked Annette to marry him. He seemed serious about his proposal.
Annette knew that Cindy fancied tall, well-groomed, blond men. The Apelts' foreign mystique was an added bonus. Michael and Rudi Apelt arrived at Bobby McGee's in a limo, bedecked in rented tuxedos and gold chains. Their grand entrance charmed Cindy and Annette. But Kathy Monkman, the odd woman out in this moment of intercontinental infatuation, was not favorably impressed.
"It was a bad feeling from the start," she says, "and this isn't a hindsight thing. For example, Rudi's trying to pick up on me and he totally blows off Annette, the girl he supposedly wants to marry. I told Cindy later, 'These guys are gross.'"
But Cindy already was starry-eyed over Michael. He was five years her junior, but seemingly had done so much with his life--banking, computers, the German Air Force and, now, international travel.
"Cindy told me to back off and not to burst her bubble," Kathy continues, "that Michael had asked her to marry him. She kept saying, 'He's so into me, he's so into me, this gorgeous German guy. He wants to marry me.' I told her to just try and keep her feet on the ground."
Cindy didn't follow her sister's advice. Within days, she was wrapped up in Michael.
"I'm in a whirlpool situation," she wrote in her diary a week after meeting him. "Annette and I met two guys from Germany and we've gotten ourselves a big pickle of a situation. . . . See how stressed out I am. I am shaking."
Some of Cindy's doubts were fueled by sister Kathy's negative opinion of the Apelts. But there were other disquieting signs.
One day, Cindy discovered she was missing more than $100 after the Apelts left her apartment. Suspicious, she and Annette phoned a Holiday Inn in Mesa, where the Apelts supposedly were staying. But the brothers weren't registered there. The women then called several hotels in the area, finally tracking Michael and Rudi to a Motel 6.
After dinner that night, Cindy and Annette dropped off the brothers at the Holiday Inn as usual, without mentioning their sleuthing. The women waited a spell, then drove to the Motel 6.
To their shock, a woman with a German accent answered the door at the Apelts' room. It was Anke Dorn, Michael's 26-year-old former girlfriend.
The next day, the brothers expressed outrage at the audacity of the nosy Americans. They claimed Anke was a family friend whose husband was in a Phoenix hospital.
The Apelts said they'd fibbed about their whereabouts on orders from their unspecified employers. The snooping had cost the men their "high-security" jobs and work visas, Michael and Rudi said.
Cindy Monkman had reached a crucial point on her path to destruction. Blinded by their affection for the Apelts, she and Annette failed to heed the alarms that should have gone off in their minds. Instead of walking away, the women caved in to the smooth-talking Teutons.
"What do you want us to do, marry you?" Annette Clay blurted, trying to make amends.
"Yes," the brothers replied.
Michael moved into Cindy's apartment on Alma School Road, and Rudi moved in with Annette. Things soured quickly between the latter couple, and Annette kicked him out after four days.
Michael Apelt told Cindy that his brother and Dorn had returned to Germany. He was alone now in the States, he repeated. All he had was her.
Actually, Rudi and Anke were living in a cheap motel a few miles away.
Michael was relentless in his quest to marry Cindy, who, caught in an emotional maelstrom, took the bait.
"I'm going to Lost Wages [Las Vegas] tomorrow to make the plunge," she wrote in a journal entry dated October 27, 1988. "I feel so happy and a little crazy about the situation. Am I doing the right thing?"
"How many times can you tell your sister that something's wrong with the guy she's seeing?" asks Kathy Monkman-Nimon. "You don't want to lose her, so you rein yourself in. I thought the worst-case scenario was he'd dump her, break her heart and run. But I knew there was more to this guy's story."
Was there ever.
The short version: The Apelt brothers, Anke Dorn and Rudi's wife--yes, he was married--flew from Germany to Mexico City in August 1988. From there, they traveled to San Diego with about $10,000 between them.
The brothers started hitting San Diego's nightspots. Their mission was to seduce and then rip off American women.
At one watering hole on Labor Day, 1988, Michael and Rudi met two Phoenix women. The brothers claimed to be wind-surfboard manufacturers and Mercedes importers. Impressed, the women gave the men their phone numbers in Phoenix.
That chance meeting led the Apelts to Arizona, and a series of modestly clever scams that netted them some needed dollars. (One Valley woman gave Rudi Apelt $2,200, ostensibly for airfare to Germany, after he showed her a telegram indicating Michael had been killed in a car wreck. In a similar ruse, another woman received a telegram stating Rudi had been killed. The woman went to the Apelts' motel room to console Michael. The "late" Rudi answered the door. End of scam.)
Rudi Apelt's wife bailed out in September and returned home to Germany. The brothers and Dorn decided to make a go of it in Phoenix.
The trio was running low on money, but the Apelts stuck with their original plan.
The brothers would track the scent of a vulnerable, lonely woman. One of them would con her into giving up her heart--and then her pocketbook.
That vulnerable, lonely woman was Cindy Monkman.
"Here I am, a married woman from the Candlelight Chapel of Lost Wages!" Cindy wrote on Sahara Hotel stationery the morning after she married Michael Apelt.
"I'm VERY happy to be married to Michael. . . . For some reason we have been brought together. Now, I've made my decision. Where do I go from here?"
Insurance agent Doug Ramsey had fallen on hard times.
A veteran of almost a quarter-century in the business, he'd migrated to Arizona as the State of Kansas was taking steps to revoke his license to sell insurance there. Ramsey had stolen $2,200 from a client and had gotten caught. Somehow, he'd escaped criminal charges, but his insurance career in Kansas was finished.
The State of Arizona, however, apparently hadn't yet been notified of Ramsey's wrongdoing. He found work in Phoenix as an agent at an independent firm on East Thomas Road.
Ramsey was on duty when a neat, polite couple named Cindy and Michael Apelt walked in unannounced on November 7, 1988. Cindy did most of the talking, Ramsey said in interviews with police and prosecutors after her murder, while Michael pored over his German-English dictionary.
The couple knew exactly what they wanted: $1 million each in life insurance, with a double-indemnity clause that would increase the payoff if one of them died accidentally.
Apparently coached by Michael, Cindy told Ramsey that life insurance is the norm in Germany for newlyweds. Michael had gobs of money coming to him from an estate, she continued, but planned to find work in the computer industry--he'd worked for IBM in Germany--as his English improved.
"Cindy was a tremendous personality," Ramsey later told police. "She was very easy to talk to. But I very seldom had a young couple come in and talk about that much insurance. I said, 'Cindy, for $1 million of life insurance, you usually have to have assets of some kind. I don't see how we can get $1 million insurance. I will check out what I can do.'"
Ramsey had done business with Surety Life, a highly rated firm based in Salt Lake City. He asked Surety to provide $400,000 on both Cindy and Michael Apelt. (Ramsey never told anyone at Surety--or later at Banner--that the newlyweds had wanted at least $2 million in life insurance.)
The file went to Surety's underwriting department, eventually landing on the desk of vice president Lynn Patterson. His task was to determine how much "risk" the Apelts posed for the company.
Risk in the insurance world means many things, including the ability of policy applicants to make premium payments; health concerns; and whether someone has applied truthfully.
A prime underwriting component normally is a background investigation of applicants. In the Apelts' case, it was conducted by Equifax Services of Atlanta, Georgia.
The Equifax report indicated Michael had been an IBM computer programmer and Air Force pilot in West Germany. It also cited the Apelts' net worth at a whopping $540,000, which included Michael's alleged $500,000 "estate" in Germany.
Cindy's earned annual income was listed as $15,200, Michael's as zero.
"The purpose of insurance is to protect the family," Patterson testified in a 1992 deposition. "I had every reason to believe that the need and the reason for purchase was valid."
The Equifax report was at the core of his belief.
However, Equifax based its glowing report solely on one phone interview conducted with Cindy Apelt. That's because agent Doug Ramsey had instructed the firm "to submit this [report] to your underwriting department without benefit of outside sources."
In other words, please don't do any digging into Michael Apelt's background.
"The underwriting investigation performed for Surety was unusually inconclusive," Equifax's Jon Allen said in a 1992 affidavit. "In particular, Equifax would not ordinarily have submitted a report in which a spouse was the only source of information."
Allen conducted a thorough investigation of Michael Apelt only after Cindy's slaying, and concluded, "It appeared that Mr. Ramsey, the local agent, was rushing the insurance applications to Surety and Banner. Mr. Ramsey stood to make a significant commission on the policies."
Despite Doug Ramsey's instructions, an Equifax investigator advised Surety that his firm's Foreign Department could easily investigate Michael Apelt in Germany. Surety and, later, Banner Life declined the offers.
But Lynn Patterson still had serious concerns. One was over whether the Apelts could afford the premium payments on a $400,000 policy--more than $3,500 a year, more than a quarter of the couple's true income.
"400K excessive for both," Surety's Patterson concluded in an internal memo dated November 23, 1988. "Told [Ramsey] I have concerns here. Recent immigrant. Just married after one month. Lots of stated unverified assets in foreign country--[medical] exam and everything else looks good. Will reconsider increased coverage in a year."
Patterson informed Ramsey that he'd write a life-insurance policy on the Apelts for $100,000 each, not $400,000 each.
(For arcane technical reasons, neither Surety nor, later, Banner Life approved the Apelts' application for double-indemnity coverage in case of accidental death.)
Patterson informed Ramsey, who phoned the Apelts with the discouraging news. But the agent was undaunted. He had been in contact with Banner Life Insurance Company of Rockville, Maryland.
Ramsey told Cindy and Michael he'd apply for $300,000 in coverage for each of them from Banner. As with Surety, each spouse was to be the other's sole beneficiary.
Cindy wrote Banner Life a $240 check to cover the first month's premium in case the company approved the application. Ramsey said he'd be going to Banner headquarters in Maryland in a few days, and he would personally deliver the application and check.
The bloom already was starting to fade from the month-old marriage. Cindy confided in her sister, Kathy, that Michael was cold and manipulative, which she attributed to his German heritage. He'll warm up, I just know it, Cindy would tell her sister.
On Thanksgiving Day, Kathy watched in dismay as Michael openly mocked Cindy when she got weepy during a showing of the movie E.T. The Extra-Terrestrial.
"She's the sentimental type, and he's tearing her heart out in front of everybody," Kathy recalls. "`You big crybaby. What a baby.' She goes to the bathroom crying, and he follows her. She told me later it wasn't to apologize, but to give her more shit."
Cindy also confided in Kathy about the life-insurance situation. She tried to explain that the insurance somehow would speed the transfer of his "estate" funds from Germany. A $50,000 check was due any day, Cindy told her sister, with much more to follow.
Kathy didn't get it, but she decided to try to support her sister.
Cindy's finances were dire. She now was supporting two people, and her bills were adding up. From the time she met Michael Apelt until her death ten weeks later, Cindy withdrew more than $4,000 from her savings account.
On December 2, Doug Ramsey visited the corporate offices of Banner Life in Maryland. He met briefly with Mary Jo Fox, the company's manager of underwriting and new business.
Ramsey offered to give Fox the Apelts' first premium check, contingent on Banner's acceptance of the $300,000 policy. Fox declined, in part because the size of the requested policy mandated a background investigation by Equifax.
Fox recalled later how she hurried things along to impress Ramsey in his first contact with Banner.
The second Equifax investigation was as skimpy as the one conducted for Surety. Again, one phone call to Cindy Apelt provided the only source of information about her new husband.
By now, Michael had obtained a social security number and was working part-time as a cook at an Italian restaurant. Equifax listed his annual income as $12,000, which, when added to Cindy's earnings, meant a combined income of $27,200.
But Doug Ramsey's field report to Banner, dated November 30, 1988, had indicated that Michael was in the "professional/management field," and that he and Cindy had a combined income of "$50,000-$74,999 a year."
Both notations were patently false, but Banner never asked Ramsey or anyone to explain the discrepancies.
Christmas was approaching, and Cindy made plans with sister Kathy to visit their parents in Illinois. Cindy still hadn't told Jack and Marjorie Monkman that she was married, another source of distress during the increasingly troubled days.
In mid-December, she and Michael announced their marriage during a "Decemberfest" party at their apartment. The couple invited Doug Ramsey, who attended for a short time.
Kathy suggested to Cindy that it might be best to tell their parents about the secret marriage before the trip home. Cindy did so, and was pleasantly surprised by the positive response.
On December 22, 1988, Doug Ramsey dropped off the $100,000 Surety life-insurance policy at the Apelts' apartment.
The agent also had some good news about the Banner Life application--the company had approved it, and for the entire requested $300,000.
Cindy wrote Banner a new check for the first month's premium.
Michael Apelt thanked Ramsey profusely.
The next day, he and his brother, Rudi, committed murder.
Cindy Monkman Apelt died of numerous stab wounds to the neck, back and abdomen. The bruises on her face and body indicated she had been beaten into submission, though whether it was before, during or after the trip to the desert was uncertain.
A wound on one of Cindy's hands proved she was conscious and had tried to defend herself when first attacked.
In a final insult, Michael Apelt stepped on his prostrate wife's face. The telltale Reebok footprint that remained would help convict him of murder.
Michael drove off in a rented Subaru, as Rudi and Anke Dorn left in another rental car. In a cruel irony, the trio met later that night at the same Bobby McGee's where Michael had first wooed Cindy.
"My wife's too fat and she doesn't need to eat, anyway," Michael Apelt told a waitress, as he feigned concern over Cindy's absence.
Cindy's credit card paid for the trio's postmurder drinks and dinner.
Michael returned to the apartment about 2 a.m. There were calls on the answering machine from Kathy, Annette Clay and another woman, worried because Cindy hadn't shown up for an early-evening engagement as planned.
Michael called Kathy and claimed Cindy had left the apartment early that night after getting a call from an angry man.
Annette and Kathy decided that one of them should go to Cindy's apartment. Annette knew Michael far better than did Kathy, so she took on the task. Once there, she called the Mesa police.
The police responded and interviewed Michael and Annette. After they left, Michael passed out drunkenly. Annette stayed by the phone, praying for a call from her friend.
A panicked Kathy Monkman called another friend for advice.
"She told me, 'I don't believe a word that guy is saying,'" Kathy recalls. "I crumbled and fell back on the bed. I've never felt that way before. The first thing I said was, 'Oh, my God--the life-insurance policy!'"
Kathy then called Cindy's apartment. Annette Clay answered the phone.
"I told her, 'You need to get out of there,'" Kathy says. "She wrote down the rental car information and she left."
At a loss, Kathy phoned her parents in Illinois. They recommended that she fly home as scheduled that morning. Kathy left Cindy's airplane ticket and a note at her own apartment--Cindy had a key.
She then flew east, sobbing the entire way.
Michael Apelt visited agent Doug Ramsey three times in the days after Cindy's body was discovered. Ramsey said later he wasn't quite ready to think the worst of Michael, though his boss certainly was.
"The first day, Mr. [Richard] Franko said, 'Well, Michael did it,'" Ramsey told police. "I said, 'I never would say that.'"
Michael didn't specifically ask Ramsey if and when he would get the $400,000 he assumed would be coming to him. But, with Ramsey's help, he used the insurance money as collateral and borrowed money from a bank for airfare to Cindy's funeral in Illinois.
Michael's brother and Anke Dorn joined him.
"He played the doting-husband role," Kathy Monkman-Nimon says, "and it was disgusting. There were undercover cops, though we didn't know it at the time. My parents were still open-minded then, but I made the decision that these people weren't to cross the threshold of our family's home.
"At the funeral home, they're sitting in the back--Rudi is wearing my dad's suit, for God's sake. I walked up to them and shook their hands, but I also telegraphed a message with my eyes--`You're not bullshitting me. I know what you did, you sons of bitches, and it's a matter of time.'"
Shortly after returning to Phoenix, the Apelt brothers and Dorn flew to Los Angeles. Dorn later testified they paid a homeless man $20 to record a message on Cindy's answering machine.
The trio told the man to read the note precisely as written. It said:
"Hear what I have to talk. I have cut through the throat of your wife and I stabbed and more frequently in the stomach in the back with a knife. If I don't get my stuff, your girlfriend is next and then our brother and last it is you. Do it now, if not, you see what happens. My eyes are everywhere."
The message would become a devastating piece of evidence against the Apelts. Experts testified it mirrored how an English-deficient German would have composed a note.
Michael called a Mesa detective to report the recorded "threat." He took the tape down to the station, fearful, he said, for his life. The cops played along, but they were closing in on the Germans: The life-insurance policies on Cindy and Michael's inconsistent stories were about to sink them.
On January 6, 1989, the police asked the trio to come to the station. They separated Dorn from the brothers. Within a few hours, she told detectives what she knew.
On the same day police arrested the Apelt brothers, one Banner Life vice president wrote a memo to another:
"There seemed to be a great deal of pressure on Ramsey's part for a quick issue [of the $300,000 policy]. Ramsey said he only wanted to show the other agents how smooth underwriting goes through Banner and on a timely basis. This was apparently the problem they were having with Surety."
But Ramsey told police a different story. He said Cindy had told him she wanted to show her father the policies during her short trip home. That was the reason for the rush job.
The damage control already was starting.
In the weeks after Cindy's murder, Jack and Marjorie made inquiries with Surety Life and Banner Life about their daughter's life-insurance policies.
It wasn't about money for the Monkmans--the couple is independently wealthy.
But they knew that Michael Apelt would be ineligible to collect any death benefits if convicted of murder. And they wanted to know why Cindy's estate--of which Marjorie Monkman was to be the executor--shouldn't be entitled to the $400,000.
"For whatever reason, Cindy had bought the insurance," Jack Monkman says, "and she did it in good faith. The money wouldn't help us with our loss, but we planned to use the money as some kind of memorial for our daughter. That's the least they owed her."
At Surety and Banner, the sticky matter had been sent over from the underwriting department to claims. The companies asked Equifax--finally--to conduct a true investigation of Michael Apelt's background.
But it wasn't guilt or remorse that compelled the firms to pursue the matter.
Surety and Banner did so because they hoped to prove that Michael had defrauded them. Case law generally allows companies to declare a policy void when a customer submits a fraudulent application.
Banner clearly had a bigger problem than Surety: Lynn Patterson, the underwriter at Surety, could at least claim to have made a good-faith effort at doing things right. His best evidence was that he had decreased the Apelts' requested amount of insurance from $400,000 to $100,000.
But Mary Jo Fox at Banner had signed off on the $300,000 policies with little more than a wink and a grin. She had many more questions to answer.
Equifax assigned Jon Allen to the case. Allen learned quickly that Michael Apelt had no $500,000 estate and hadn't worked for IBM or any other firm as a computer programmer. His last job in Germany had been as a laborer in a trolley-car factory.
Michael Apelt was a fake.
Surety and Banner used the following Equifax information to try to bolster their case of fraud against Michael Apelt:
He was a recent immigrant who had married soon after meeting Cindy and had applied for life insurance shortly after that. He originally had sought $1 million-plus in life insurance on his bride, a ridiculously excessive amount.
Of course, there was nothing new about any of that. But in the hands of the companies' claims investigators, Michael's history took on a far different--and convenient--meaning.
The insurance companies were thrilled by Allen's "findings." Their fraud case against Michael Apelt had gotten off to a rousing start.
The companies were also pleased when the Apelts' prosecutor, Cathy Hughes, said in court during Michael's trial: "The only possible motive in this case is money to do something like that. . . . The insurance is the crux of this case."
The firms offered to help Hughes prove that point.
"They gave me anything I wanted," recalls Hughes, now an assistant Maricopa County public defender. "I knew they had another agenda--it was very, very obvious--but I couldn't concern myself too much. My job was to convict bad guys."
Hughes had little trouble convincing two juries to convict Michael and Rudi Apelt of first-degree-murder charges. Both men landed on death row.
In an April 12, 1990, memo, Bob Jennings, Banner Life's vice president of claims, summarized an interview he had conducted with underwriter Mary Jo Fox. One key question: "If we had known Michael Apelt did not have an estate of $540,000, would that have affected our action?"
Fox said it would have.
Jennings quoted Fox as saying, "Had we known that there was no estate, no earning potential and that the only earning power was $10 an hour at a restaurant, we would not have accepted the application."
That news would be of far more consequence--and horror--to the Monkman family than to Banner.
(Fox later changed her tune dramatically, saying in a deposition that she had not taken Michael's alleged "estate" and work history in Germany into consideration before she approved the policy. "I was comfortable with the age, potential earnings and the amount applied for," she stated.)
On July 2, 1990, Jennings informed the Monkmans that Banner wouldn't pay Cindy's estate a cent. One excuse was Michael's fraudulent intent. Banner also maintained that the policy had never taken effect because the company had not cashed Cindy's check before she was killed.
Surety claims manager Betsy Jerome also denied the Monkmans' claim for $100,000, strictly on the basis of Michael's fraudulent intent.
In March 1991, Jack and Marjorie Monkman sued Banner Life, Surety Life, agent Doug Ramsey, Equifax Services and its investigator Jon Allen. (Equifax and Allen no longer are defendants.)
The Monkmans' Phoenix attorneys, Mark Samson and Donald Peters, summed up their theory of the lawsuit in legal papers: "They want the power to ignore and fail to investigate warning signs while underwriting a policy, then 'discover' those facts after a death and rely on them to avoid a policy."
The attorneys warned the Monkmans that their lawsuit would be an uphill struggle.
The main reason is that Arizona courts apparently haven't even addressed whether there's a duty for an insurance company to take action to protect an insured person from criminal acts.
Judge Roger Strand agreed with that viewpoint in a March 1993 ruling that turned the Monkmans' wrongful-death action into a contract case.
The key players testified this past summer at a two-day trial before Judge Strand. Banner Life underwriter Mary Jo Fox glibly told the judge that the process of insuring the Apelts had been "reasonable and customary."
The judge didn't allow the Monkmans to even raise the issue of the insurers' culpability in Cindy's death. All they could argue was that Banner and Surety had insured her life for $400,000, and that they owed her estate that sum.
During a break, Kathy Monkman-Nimon encountered Fox in the ladies' room. She watched as the underwriter washed her hands.
"I wanted to tell that woman something, but I couldn't bring myself to do it. I wanted to say, 'All you people can wash all you want. You're never gonna wash the blood of my sister off your hands.'"
Mary Jo Fox is now self-employed, but says her decision to leave Banner Life had nothing to do with the Apelt case.
Doug Ramsey's last known address was in Alaska. According to that state's Department of Insurance, he has not applied for a license to sell insurance.
Anke Dorn returned to Germany after she testified at the Apelts' murder trials.
Rudi and Michael Apelt live in tiny death-row cells at the Arizona State Prison in Florence, awaiting execution. In April 1991, according to Department of Corrections records, Michael married a Mesa woman in a prison ceremony. It isn't known if life insurance was sought for the new bride.
The Monkmans buried Cindy next to her mother in Bloomington, Illinois.